Seniority is the length of time that an individual has served in a job or worked for an organization. Seniority can bring higher status, rank, or precedence to an employee who has served an organization for a longer period of time.
Seniority is important in some private sector workplaces, professions, skilled trades, and in union-represented workplaces. Forward thinking organizations are less likely to provide preference for senior employees unless the preference is part of a number of factors considered in salary, promotion, layoffs, and other workplace employment decisions.
In a union-represented workplace, seniority drives the majority of decisions regarding wages, hours, vacation time, promotions, over-time, preferred jobs, and other benefits and privileges. These terms and conditions of employment are agreed to in a union contract. This is also true of skilled trade workers when represented by a union. In fact, who becomes an apprentice and learns a skilled trade is negotiated by the union,
In union-represented workplaces, if a job is eliminated or a layoff required, senior employees have “bumping” rights and may be reassigned to take over the jobs of younger and newer employees when their job is eliminated. Or, historically, union employees were assigned to jobs banks and continued to collect their pay as if they were working (eliminated in the recent taxpayer bailout of General Motors).
In other workplaces, seniority is a factor that may be considered, but does not guarantee preferential treatment for senior employees. The employer determines whether and if seniority should determine employment decisions or the degree to which it determines working conditions for employees.
In union-represented workplaces, all employment decisions are made based on seniority, but other employers have the option to use seniority as a factor in their decision making or not. If seniority is used for pay increases or promotions, it is usually considered along with factors such as contribution, performance, experience, and job fit. Senior employees who effectively contribute are valued by employers for their experience, historical knowledge about the organization, its products and customers, and their loyalty.
Seniority becomes important when employers make the decision to lay off employees. Employment lawyers recommend seniority as a factor in the layoff decisions. They recommend that employers are less likely to be hit with discrimination charges when layoffs are done by seniority with the newer, less experienced employees let go first. (However, employers face the probability that their most educated, technology-sophisticated talent will be eliminated first, which is why I don’t recommend this approach.)
Even in workplaces that do not consider seniority in employment-related decisions, seniority may still be honored in other ways. The goals are employee retention and employee engagement. So, organizations may recognize the longevity of employees with service awards, mentoring opportunities, longevity recognition, public preference for sharing historical knowledge, and key assignments.
You want to encourage longevity from your employees because your organization benefits from having senior employees with company knowledge and experience. But, unless obligated by contract, seniority should never be the only factor considered in employment decisions.